What to consider before you invest internationally
Here’s why it’s crucial to consider the impact of any international investments
International investment exposure is non-negotiable from the point of view of portfolio diversification. However, according to Mike Wilmot, head of investments at Nedbank Private Wealth: “International investment objectives based on unreasonable tax outcomes, opaque asset ownership or speculative short-term currency views have no place in any sensible process. It is therefore crucial to consider the impact any international investments may have on your will, your tax and estate liabilities, tax administration, and compliance with exchange control and other legislation.” There are various ways to get international exposure, including:
Assets you buy and sell in South Africa where there is indirect (companies with offshore earnings) or direct (via feeder funds) international gearing. Using institutional foreign investment allowances (commonly referred to as “asset swap” mechanisms) where rand amounts are externalised to buy international assets offshore, but the proceeds must be...
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